Ekspats (belastings) vanaf 1 Maart 2020

 

Baie van ons mense weet dit reeds.  Daar is tans belastingvrystelling vir Suid-Afrikaners: Indien jy vir 183 dae of meer in die buiteland is met ten minste een reis van 60 agtereenvolgende dae (nie van toepassing op skeepspersoneel nie), dan is die buitelandse inkomste wat buite Suid-Afrika verdien is ingevolge Artikel 10(1)(o)(ii) van die Inkomstebelastingwet, 1962 (Wetno. 58 van 1962) van belasting in Suid-Afrika vrygestel.

Understanding Financial Emigration and the tax on foreign employment

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Hierdie vrystelling is steeds geldig, maar die Suid-Afrikaanse Inkomstediens (SAID) het aangedui dat dié vrystelling vanaf 1 Maart 2020 slegs op ’n maksimum van R1 miljoen in verdienste van toepassing sal wees. Hierdie is die enigste verandering: ’n Perk is op hierdie vrystelling ingestel.

Indien jy dus in die buiteland werk en R100 000 per maand (R1,2 miljoen per jaar) verdien, sal die maksimum bedrag wat moontlik belasbaar word R200 000 wees. Daar is egter ’n aantal ander toetse en/of faktore wat in ag geneem moet word.

Ingesetebelastingbetalertoets

Die toets vir ingesete belastingbetalers (Engels: tax residents) is dat enige individu wat gewoonlik (soos in gemene reg gedefinieer) woonagtig is in Suid-Afrika tydens die assesseringsjaar of, in gebrek daarvan, aan al die vereistes van die fisieseteenwoordigheidstoets voldoen, as ingesete belastingbetaler geag sal word. ’n Persoon word as gewone inwoner gesien in die land waar hy of sy primêr woon en gedryf word deur bedoeling, indiensneming, ligging van persoonlike besittings en waar hul familie gebaseer is. Indien normale inwoning nie bepaal kan word nie, sal die fisieseteenwoordigheidstoets ’n vyfjaartoets wees van die tyd wat jy binne Suid-Afrika deurbring. Om Suid-Afrikaanse burgerskap, ’n Suid-Afrikaanse ID-boek of ’n Suid-Afrikaanse paspoort te hê sal jou nie by verstek ’n ingesete Suid-Afrikaanse belastingbetaler maak nie.

Byvoorbeeld: Indien jy jou huis in Suid-Afrika verkoop het en met jou gesin na Nieu-Seeland getrek het, jy huur of besit ’n huis in Nieu-Seeland, jou kinders gaan skool in Nieu-Seeland en jy werk daar, dan is die kanse goed dat jy nie ’n ingesete belastingbetaler van Suid-Afrika is nie. Die nuwe wysiging sal dus geen invloed op jou hê nie, aangesien die SAID slegs nie-inwoners kan belas op dit wat hulle van ’n bron binne Suid-Afrika verdien. Dit sal dus nie vir jou nodig wees om finansieel te emigreer om nie belasting te betaal nie.

Dubbelbelastingooreenkomsbeskerming

Suid-Afrika het ongeveer 60 dubbelbelastingooreenkomste (DBO’s) met verskillende lande. Die meeste van hierdie ooreenkomste is op dieselfde model geskoei, en pas die reël toe dat die land waarin die belastingbetaler vir 183 dae of meer per jaar gewerk het normaalweg die land sal wees wat die reg het om die verdienste te belas. Dus, as jy buite Suid-Afrika werk – in ’n land waarmee Suid-Afrika ’n DBO het – vir meer as 183 dae, dan is jou verdienste as gevolg van hierdie DBO se beskerming nie in Suid-Afrika belasbaar nie.

As ’n voorbeeld: Mev. Jordaan en haar man gaan werk in Duitsland vir 18 maande. Hulle hou hul huis in Suid-Afrika en is tydelik in Duitsland, met die bedoeling om na Suid-Afrika terug te keer en is daarom ingesete belastingbetalers van Suid-Afrika. Ingevolge Artikel 13 van die DBO wat ons met Duitsland het, en omdat hulle daar is vir meer as 183 dae, is die verdienste slegs in Duitsland belasbaar. Hulle het geen belasting in Suid-Afrika betaalbaar nie en die verandering raak hulle nie.

Buitelandse belastingkrediet

Enige buitelandse belasting wat jy betaal sal ook teen jou Suid-Afrikaanse belasting gekrediteer word. Byvoorbeeld: Tydens die 2020/2021-belastingjaar werk jy vir 4 maande in Frankryk, waar jy R800 000 verdien en 15% belasting gehef word. Daarna gaan werk jy vir 6 maande in België, waar jy ’n verdere R800 000 verdien en 20% belasting gehef word. Jou somtotaal in buitelandse verdienste sal R1,6 miljoen wees en jy sou dan R280 000 in belasting betaal het. Omdat jy ’n ingesete belastingbetaler is, sal jou buitelandse inkomste bo R1 miljoen belasbaar word en dus sal R600 000 van jou verdienste belasbaar wees. Die belasting wat op hierdie bedrag in Suid-Afrika betaalbaar sal wees, sal ± R179 000 beloop. Jy het egter reeds R280 000 se belasting betaal, so daar sal geen verdere uitstaande belasting wees nie.

Wie sal geraak word?

Die nuwe wysiging sal die volgende persone raak:

  1. ’n Ingesete Suid-Afrikaanse belastingbetaler wat tydelik in die buiteland werk en wat meer as R1 miljoen verdien terwyl hy in ’n land werk wat nie ’n DBO met Suid-Afrika het nie en waar daar nie genoeg belasting gehef is nie; en
  2. ’n Ingesete Suid-Afrikaanse belastingbetaler wat tydelik in die buiteland werk, wat meer as R1 miljoen verdien en in verskeie lande werk (vir minder as 183 dae in enige van hierdie lande) en nie vir genoeg buitelandse belasting belas is nie.

Indien jy onseker is oor of jy ’n ingesete belastingbetaler is of DBO-beskerming het, of oor hoe hierdie verandering vanaf 1 Maart 2020 jou mag raak, kan jy vir Fanus Jonck (tax@jonck.net) vra.

Ekspatbelasting verander vanaf 1 Maart 2020: Hoe belasting op buitelandse vergoeding benader word

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How new tax law will affect South Africans earning income abroad.   There’s a lot of discussion about changes to the way South Africans earning abroad will be taxed in the future. We look past the headlines to figure out what the real tax and exchange control issues are. 

It’s not often that a tax amendment makes headlines and raises as much controversial debate as it has with the imminent changes to how foreign employment income of South African tax residents will be taxed from 1 March 2020.
 
Potentially affected South African tax residents will find a plethora of views in the media, some correct, and others somewhat misguided and naïve when it comes to the correct application of the law. However, with time running out, it’s crucial that correct decisions are made relating to #TAX2020 (the trending hashtag), based on each person’s particular circumstances.


This article sets out the various aspects to consider, from both a tax and exchange control perspective. 

https://www.investec.com/en_za/focus/money/tax-south-africans-earning-abroad.html

 

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SA expat tax law: How to avoid SARS clamp-down on expat income.  A legislative amendment to SA expatriate tax law is set to come into effect on 1 March 2020, and to avoid criminal prosecution, South Africans working abroad can opt for “financial emigration”, suggests Claudia Aires Apicella, head of financial emigration at Tax Consulting SA. She explains that financial emigration is a process provided for by the SA Reserve Bank (SARB) to change one’s tax status from “resident” to “non-resident”.

The legislative amendment states that South African tax residents abroad will be required to pay tax to SARS of up to 45% of their foreign employment income, where it exceeds the R1m threshold. 

When one “emigrates financially”, however, they cease to be a South African tax resident and will not be liable to pay any South African tax on their worldwide income. They will, however, be required to declare any South African sourced income which may be taxable, such as rental income.

According to Apicella, SARS has begun prosecuting taxpayers that are non-compliant and, in some cases, has the option to imprison the offender up to a period of two years. SARS tax audits focus especially on those expatriates who have left and simply decided to ignore their taxes.

While some did not consider it necessary to submit tax returns in SA, others submitted zero-tax returns to SARS. In some cases, individuals even indicated that they were unemployed on their tax returns while earning expatriate salaries.

“Many expatriates hope that SARS will drag their feet, but the 2017/18 South African tax return already included targeted questions dealing with expatriate tax status,” cautions Apicella.

“These questions may appear innocent enough, but we have seen this trigger an automatic verification or audit process. Where the question is marked false, this is a criminal offense, thus creating an even more serious problem.”

 

No more hidden offshore accounts

SARS had committed itself to completing its implementation of the Organisation for Economic Corporation and Development’s (OECD) Common Reporting Standard (CRS) by end of December 2017.

This means there will no longer be offshore hidden money, as the world has followed the lead of the US in forcing disclosure by financial institutions of any account owned or otherwise connected to South African residents or citizens, according to Apicella.

“SA citizens or residents who do offshore banking will be reported to SARS, and this will be an audit trigger if your SARS profile is not correct,” says Apicella.

How does foreign employment affect South African expats

 

Financial emigration is exactly what it says, it is a change of financial status that you can choose to undergo if you have left SA to take up a permanent residence outside the CMA [Common Monetary Area – SA, Namibia, Lesotho and Swaziland].

 

It is correct that the financial emigration process of the SARB is subject to filing a tax clearance to confirm a good tax standing, that all returns have been filed and that all taxes are paid or provided upon departure. With some exclusions.

 

Financial emigration is not a tax emigration requirement, nor does it trigger or guarantee tax emigration or non-resident tax status. Product providers or financial emigration specialists, are misleading taxpayers who are now promoting financial emigration at all cost or as the ultimate solution to escape the new #Tax2020 rules.

 

Yes, the minute your selected advisor suggests that financial emigration is NOT an option, it’s a pre-requisite or a way to tax emigrate, be sure to get a second opinion from a tax specialist like ourselves who doesn’t earn our fees from the financial emigration process.

 

So what is the taxpayers’ best solution or option available?

No one solution can be found for everyone. The answer is in client-specific tax profiling and in recent years the following tax issues and profiles have been identified by FinGlobal’s team.

 

Expats without tax-exempt amounts

 

It has been apparent, how many expat South Africans have incorrectly believed that they have been and will continue to enjoy tax exemption on their foreign income, not having emigrated tax (i.e. they are tax residents or considered tax residents).

 

The act is rather clear, and interpretation Note 16 (Issue 2) [IN16] stipulates that the exemption is limited to remuneration from foreign employment, whereas passive and business income remains fully taxable for as long as one is a tax resident in SA.

 

Basic evaluation of exemption include:

  • Passive income and independent contract income are not eligible for a tax exemption;
  • Calculation of the Days Test of the 183/+60-day exemption;
  • If you qualify for an exemption, working days in South Africa will not be exempt.

 

Tax emigrated expats

 

Many expatriates have emigrated a few years ago, but they have failed to notify SARS and, more importantly, they have failed to pay the exit tax. Their tax exposure, penalty and interest liability now faced my actually have a greater cashflow impact than the new #Tax2020 rules.

 

Tax on pay at source

 

Working in a country that does not tax you on worldwide income, yet you are taxed from employment on local income. These tax systems rely on source-based rules to collect tax against immigrant or guest employee, yet most taxpayers didn’t even know their employers paid the source tax on their behalf, taxpayers are advised to ask their employers about the taxes they pay on their behalf, since SARS will allow a foreign tax credit. This rule applies to both treaty and non-treaty countries.

 

Employment income

 

There are, in fact, a small number of expatriates who have no other choice, but to adjust their lifestyle because, as of 1 March 2020, their new net after-tax revenues will have to be adjusted.

  • Independent contractors do not receive “pay” and as a rule, are not eligible for the exemption. Therefore, a person must be an employee who receives salary to qualify for the exemption.

 

Ship officials and crew

 

The tax exemption for natural persons working on a ship is governed by a separate set of rules. In fact, there is a separate Interpretation Note 34, which covers water staff. The rules set out in Interpretation Note 16 (Issue 2) must be applied by employees on the ship, not involved in the passage or navigation of the shop (mining and exploration personnel, as well as on-board shop operators).

 

Main Interpretation differences between Note 16 and 34 include:

  • The 183 days are determined for crew and officers on a year of tax, other foreign workers are testing their days outside in any twelve months; and
  • The 60 day rule is to qualify for a continuous day that is not applicable to crew or officers on a vessel that carry passengers for rewards, and
  • Ship crew and officers will not be subject to proportional tax on the days spent in SA, whereas an employee qualifying under the normal foreign employment exception, will have to pay SA tax on the days employed in SA, i.e. they only enjoy a proportional exemption; and most importantly
  • As explained in Interpretation Note 34, the crew and officers are eligible for the exemption will not be subject to the R1m exemption cap.

 

Up to now SARS guidelines issued

Sadly, one year after the promulgation of the new act and less than a year away from implementation, SARS has not issued any new or revised guidelines. The updating of SARS guides and interpretation notes are unfortunately, notoriously slow.

 

Hopefully, SARS will soon release the 3rd version on Interpretation Note 16 and will even consider updating Interpretation Note 34, and will give clear guidelines on Exit Tax.

 

FinGlobal: South African financial emigration specialists

We’ve made financial emigration and international transactions our entire business, and we exist to make the entire process as smooth as possible for you., FinGlobal’s team of compliant, accredited financial experts are here to help. Get in touch, and let’s get your money moving.

https://www.finglobal.com/2019/05/31/foreign-income-tax-exit/?utm_source=twitter&utm_medium=blog&utm_term=BlogPost&utm_campaign=20190714-blog

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